David Rubenstein Examines The American Experiment

How to Lead on Leadership. The second, The American Story, was all about the American history. UH, and the book's title, The American Experiment, Dialogues and a Dream is his third book in this series. So it's great to have joining us. UH. David Rubinstein, he's host of Bloomberg Wealth on Bloomberg TV and Bloomberg Radio, and of course you know him as co founder and co chair of the private equity from the Carlisle Group. He joins us in our interactive broker studio.

Thank you for joining us. My pleasure to be here. Thank you for having me. It's really wonderful and I feel like you are someone who talks with so many different people, different points of view. Um, we were wondering about the last couple of years, with everything going on, how that kind of has shaped who you want to talk to and how you were thinking about this book, The American Experiment. Well, generally, I'd like to talk to people who are willing to say something, as you know

from being an interviewer. Uh, if you watch the Sunday talk shows, sometimes you say, why do these people go on these shows? Because they don't want you want to say anything. What you want is somebody who's willing to say something and say something they haven't said before. That's the best interview, right, And so I'm always looking for somebody who is willing to be engaging and doesn't want to just spar with the interviewer and not say anything.

So you know, that's that's a challenge, but that's what I'm trying to do. And you always want somebody that people will listen to and want to hear. So if I got an engaging guest but nobody's ever heard of that person, it may not be as effective. If you can get Jeff Bezos, you know, you know that's people want to hear from him. So if you want somebody

has a name and who's willing to engage. And some people are great and some people are not as great, And you know you've just figured out during the interview. But we think about what's happened with the pandemic, the capital riots, um, the inequities, George Floyd, We could go on and on. There's it feels like a decade or two decades of history have happened in the last year and a half. How is that, David shaped kind of

your thinking and putting this book together? And again, the voices you wanted to get to, each one has a different thing. The January six event, um, I do talk about it extensively in the book, and I basically say it was a severe stress test for America and America one. And I dedicate the book to the public servants who

protect our democracy. Because remember we had sixty five lawsuits that were filed to overturn the January, to overturn the election, and none of them actually prevailed, none of them got very far. All the judges basically complied with what is the rule of law, and they basically didn't act political. So I think we learned a lot about the importance of the rule of law in this country. We also learned a lot in terms of the importance of healthcare

in this country. How it's so unfair that people are her minority status are or are poor. Really we're suffering disproportionately because of COVID because they don't have good health care to begin with, and then have access to the best health care. And it's a sad situation. But it also made me think about this, my mortality. I'm seventy two years old, and when you're seventy two, you had a chance of you got this disease that you could

maybe not survive. And we now know that six the people when on ventilators didn't actually come back out of the ventilators. We were putting people ventilators thinking was helping, it wasn't. So we learned a lot about how to treat people. But suppose I had gotten this and I went on a ventilator, I probably wouldn't be here now.

So I learned a lot about my mortality and thinking about it, and the result is I'm rushing to get more things done because I now realize, Hey, life is very sure, and something bad can happen very quickly, and so that that's been something that I've been thinking a lot about. It's like the Hamilton's right, I'm running out of time right, As you point out in the book, the American experiment has been relatively short at this point.

And I'm wondering if you could contextualize the way that you think about what happened over the last year, year, year and a half as to to what extent it really stress tested us, because you do you do make note of the judiciary essentially saving the United States, not the lawmakers, because you do call out in the book the lawmakers, the senators and the members of Congress who voted to overturn the election. They are still in power

right now. Yes, And I know many of them, and privately they will say to you, well, I had to do that, or I knew it wasn't going to really prevail. Sure many of these people are you know, I live in Washington. I host I host a series uh in front of Members of Congress once a month. With COVID ending soon hopefully I'll be resuming that. And I know a lot of members and so forth, and you know privately what they say is, um, well I had to do this and they didn't really believe in it, but

you know, and so forth. Some will say that I'm not going to go say who said that, but clearly it's a very political situation. It's just the saddest part of the whole situation we now face is that we've politicized the government so much so that the country's really unable to move forward very much. We have people who don't want to wear masks, who think that it's a

good thing to force people not to wear masks. In effect, we we we you know, a sad situation in many ways when you think about it that school children whose teachers want them to have masks are being told they aren't supposed to have that mask. So bad situation, and people are dying because of this. When did debate become like a bad thing? I thought that was what kind of the routes of democracy. We're all about, this whole idea of having different perspectives and hopefully talking it through

and getting to a better place. When I worked in Congress and nineteen seventies and in the White House, uh, there was obviously political disputes all the time, and obviously this was after Watergate, but people thought eventually you've got to get something done. And so you had bipartisan legislation. Now if to be considered a great legislator, used to be were good at bipartisan legislation, get people on both

sides of work together. Now to be a great legislator, um, you're probably somebody that is good in only getting your Democrats or your Republicans to support you. And members of Congress now spend so much time raising money because they want to raise money for their campaigns or to wort anybody from challenging them. And they have to spend their time in the case of members of the House, to

raising money. And the money and the Internet and social media has just divided the country in so many ways that I find it interesting when I host these dinners, so many people say this is the most interesting thing that members feel they're doing. In Washington. They can have a dinner when nobody sees their meeting with somebody from the opposite party because there's no press there, and they can talk to people from the opposite house, which they

really do because they rarely have conference committees anymore. It's uh, you know, look, I also recognize this every generation ten thousand years back and so forth has always said, well, in my time it was better, and now it's not as good now. George Washington's father allegedly told him, well, your dinner generation are not gonna achieve anything because you

guys are not hard working or whatever. Well, the truth is, every every generation tells the younger people, you're not gonna be tough enough, you're not gonna be surviving, and I ultimately civilization goes forward. So sure, they're they're challenges. Now. I'm not happy with many things that have happened. One thing that did happen, though, uh, during all this period of time, it is the is the George Floyd murder. In that case, the thing that struck me was this,

we've been through. I lived for the Civil Rights Revolution, We've lived through the Voting Rights Act, the Civil Rights Act, and so many things that have been done, infirmative action of the things. But this one murder crystallized for people in this country the fact that we are still discriminating in so many ways. Just think about it. All the people that have been lynched over the years didn't seem to have the same resonance as this one murder, maybe

because it was on TV. Maybe everybody saw it, maybe because people saw it was so ridiculous the way it was handled. But we've made some progress obviously on racial relations. And i'd say in the book that while we've made a lot of progress on racial relations and and and gender equality and other things, we still have a long way to go. The rhetoric that is in the Declaration of Independence and the rhetoric in the Constitution is wonderful.

What we've been spending two thirty years try to live up to that rhetoric, and to some extent we've made progress, and some extent we haven't. And what I say in the book is that we have these genes. These genes are part of us, the belief in the rule of law, the belief and equality, the belief in the power of voting. And we've been trying to make sure that people um kind of honor these things that are part of our genes.

And sometimes we do and sometimes we don't. The rule of law is a gene that's so strong that it prevailed in the January sixth situation and and the and the post election fight, and I think that was good in many other countries. And you had a leader of do what was done here. I think you could have had a military takeover. Yeah, it could have been much closer. I I wonder, David, about this sense of optimism that

you have potentially after writing a book like this. I do think there is this collective despair over the last eighteen nineteen months, as this pandemic has played out and we try to get to the other side of it. And here we are sandwiched between extreme weather events. You know that they're affecting the entire country, whether it's drought or hurricane or fires. Uh, trying to get our kids

back to school. After writing this book and speaking to these people and looking so closely at the history of the United States, are you optimistic? I think most people who are asked that question will say yes, because nobody wants to say no, I'm pessimistic. It sounds bad to say pessimistic, and I'd be lying. If I said I was pessimistic, it might make news as they I'm pessimistic. I am optimistic about many things. The young people are

so creative. We are solving some problems like global climate change. We're working on some things. Racial relations are getting better than not perfect. But uh, if you weren't optimistic. You'd be hard to get through life. If every day you were so depressed you couldn't get through life, you know, what would you do? So I'm optimistic, and I've had been fortunate in my life to be be able to be optimistic because of good things that happen to me.

But generally I'm reasonably optimistic. I've just been worried about some things that we could solve that we don't seem to be solving as quickly as I wish we would. Let's talk about some of the conversations ken Burns Medline, Albright, Um, juliep or who I don't know is necessarily a household name, Um Alter, Isaacson, David McCullough, some of the things, Rita morano Um. Some of the conversations that stood out, And obviously they talked about very different topics, the different topics

of well. Ken Burns talked about Vietnam. And it turns out in Vietnam, the political leaders knew all along, They knew all along that we had no chance of winning that war military. It was really a political um exercise, which was disappointed because we lost fifty eight thousand men and the Vietnamese lost millions of people. Um, David McCullough did a wonderful job of explaining how nobody took the

right brother seriously in this country. They had to go to France to kind of prove um that they could they could they could fly. Another reason why we love France, right. UM. You know, so, Rina Moreno is an incredible story and a woman from Puerto Rico who was not taken that seriously as an actress because she was from Puerto Rico, she was given kind of Latino Latino jobs, but she turned out to be an Academy Award winner and she

had an interesting life. She lived with um, a very famous person for quite some time, Marlon Brando and I think eight years or so, and then try to commit suicide because he was unfaithful. And then she recovered from that and obviously went on to now win an Emmy, a Grammy, uh, every other world Tony that you can win. So she's UM quite an impressive person now still performing at age eight or eighty nine. She was at our Boston Pops event and she just fire got to meet her,

and she's unbelievable in terms of her energy. You also talked with m Walter Isaacson, and I think innovation is something we spend a lot of time here, uh talking about around the table. And you know that governments the complicated relationship really between governments and innovation. We're seeing it once again. What did you glean from that conversation? Walter points out in his book really focus on the Innovators,

a book right before The Codebreakers. Codebreakers, a new book about a woman that won the Nobel Prize for infect discovering crisper Um, and and that's a great book as well. But but the Innovators is about all the people that have changed our lives. Who invented the micro processor, that transistor, the smartphone, the internet, all the things. How could we live today without the internet? How could we live today

without smartphones? All these things? But now these all came about because of smart people doing things that people said couldn't be done. And typically as part of the teams, there are very few geniuses. They're discovering things by themselves, he points out. Usually it's a person working with somebody else, and usually they're building on some something that somebody else actually did before them. But the most important thing is our country has been a country where We've been strong

because of innovation. We are the country that innovates. We're reinventing ourselves all the time. Why aren't people in Europe inventing great companies like with companies we have. You don't see as much in Europe or in other parts of the world as we have been seeing here right now. The technology that's dominating the world, certainly outside of China is American technology, Microsoft, Amazon, Apple, Facebook, um. All these companies are American companies. Why don't we aren't we dominated

by European technology companies or Middle East technology companies? Because Americans have innovative style and we really incent people to do things innovative here. Wait, I gotta follow, So what do you think about what's going on in China right now in terms of really clamping down It feels like on the innovators. Well, in China, I think what's going on is the Chinese government is trying to make it clear to everybody that we, the government, are the most

important thing and not the innovators. And so I think there's a concern that sometimes you get entre preneurs are worth a lot of money, they're they're cult figures themselves. Jack ma on the equivalent, and they kind of rival the government leaders, and the government doesn't think that's appropriate. So the government is doing some things to constrain this.

We'll see whether the impact is to have people not be quite as innovative, or whether people will try to take more money offshore, or or or entrepreneurs will come to this country and not go back to China. You don't know yet. We're talking parts with David Rubinstein. His new book is The American Experiment, also host of Bloomberg Wealth here at Bloomberg Radio and TV and co chair

co founder of the Carlisle Group. But it's interesting, David, do you think it will prevent China from being um kind of a global presence when it comes to innovative technologies, which is what President ga said he wants to be. It may have some impact, but right now, for example, what is up in the air is who is going to dominate technology and the around the world of the

next ten years. Is it going to be the American technology companies or is it going to be the Chinese trying right now, the Chinese technology companies have largely been successful in China. Google and Facebook really don't quite operate in China. They have their own equivalent there. But have China been able to take Alie pay Uh and financial Um or Ali Baba outside of China that much? Not

so much, or the same with Bai Do now. The only one that's really become a major force outside of China is Byte Dance, which has TikTok, but it doesn't operate all in China. It really operates outside. But over the next ten twenty years, twenty or thirty years or so, there will be an effort by the Chinese to say, let's take our technology companies and use them in Europe, Latin America, the Middle East, and who will dominate what we have two internets or we just have one internet?

And and it's not clear to the extent that we weaken our technology companies in this country. It may be that we won't be dominant around the world as much as we have been. But you think about it. You go anywhere in the world. Now you can turn you can use Google, you can use Facebook. You can't go use Bai Do or or Alie pay anywhere in the world. That may change unless you're in a part of China

where it's correct blocked uh. David given what's happened in China over the last few months, would you be hesitant to deploy appital there to to invest there, at least for the near future. I am an investor in China. I've been a long term investor there my firm UM as an investor there. I personally invested there UM, but I'm not thinking forward over the next few years. Given what's happened over the last few months, there clearly are

going to be some constraints on growth and valuation. So, for example, UM, many of the companies have had some constraints the and financial transaction is one and where the valuations come down because they're not going to go public quite as quickly as they were going to. I still think though, you've got a population of one point three billion people and a gigantic market, the biggest market in the world, and the country is becoming increasingly wealthy, and

therefore people are recently spending money. We operate a number of companies there. We operate with our Chinese partners and McDonald's in in uh in China, and clearly that's a growing business doing well. So I wouldn't be hesitant to invest in China. I just be hesitant to do things that the government isn't going to really like. You've got to be very careful and make sure you know what the government will tolerate and not the book at the

very beginning you include the preamble to the Constitution. If you could sit down with a forefather today, who would it be and what would you want to know? Well, I winswer on one second. I would just say that, interestingly, we had white Christian property owners men who are founding fathers, right. If we had a new constitutional declaration independence, who would those people be? It wouldn't be all white men right or property. We'd have presumably women, We'd have minorities. Would

we get a different constitution? Will we get a different declaration of independence? Probably would um. If I could have dinner with any one of those founding fathers, I guess it would be Thomas Jefferson, just because his rhetoric is writing style is so wonderful, And I'd ask him how come you never made a speech as presidently made one public speech. If you ask Water Risings, he would say he'd like to have all the people he's written about,

He'd like to have dinner. I think he would say with Benjamin Franklin, because he's so creative and so brilliant, so many ways uneducated by traditional standards, but now any of them. I think if I could have dinner with anybody that's ever lived and who's an American not currently live, it would be, without doubt Abraham Lincoln. It might be the greatest American of them all. Kept the Union together. Uh freed the slaves, though not as quickly as some

people would want it. But he was an incredible person, writer, credit speaker, and and I just like to ask him this a lot of questions. And it's interesting phenomenon. You and you and I are all in the interview business. And this is a business where it's just relatively common now, it's not unique to be an interviewer, right, lots of people. Everybody has a podcast. I think there should be a bumper secret and says punk if you don't have a podcast.

Everybody kept their own podcasts. Everybody cut there on TV show, everybody's got their on radio show. But this is relatively new. For most of organized history, there were no interviews. So we have no interviews of Shakespeare, we have no interviews of Cleopatrick, we have no interviews of Abraham Lincoln, George Washington. I wish we could go back and interview them. I thought about doing a book interviewing what these people would have said if I'd interviewed him. That's a great idea.

So I got to say, William Shakespeare, No, will Um, why do you think it is that people think you didn't write these plays? Or did you really write these plays? Tell us the truth? Or Cleopatri who was a better lover? When Mark Anthony or Julius Caesar? When the interviews right? Yeah? For Henry the Eighth, why why didn't you just get a prenup instead of chopping off the head of your wife. There'll be a lot of great questions. We we want to know the answers to what you took. Number four.

You did get some fantastic names for for this book, you know, including Ken Burns as we talked about, Madeline Albred, John meetch Um, Billy Jean King. Uh. Who did you reach out to that you couldn't get? Who said I'm sorry? Who's this? David Rubinstein? I don't have time kidding. No, Look, some people do not like to do interviews, and some people are more more complicated to get a hold up and so forth. So I UM on this particular book, I have not interested so did this way. I have

not yet interviewed Elon Musk. I'd like to do that. Um Water Isaacson is writing a book about him and that presumably will be the source of a lot of information on Twitter a few weeks ago talking about that. I talked to Water about it and he's very happy spending time with him now. And Ellen is uh, I won't give away all this, all the stories it's gonna be. It's gonna happen absolutely, um, And I would say that i'd like to interview I have an interview Mark Zuckerberg.

I'm on a board with him in China. I've been there when we talk to him a couple of times, but I haven't really interviewed him, and I think that'd be interesting. I had a chance to invest in that company when my son in law to be was at Harvard and he said investment company. I said, it's a dating service, and dating service never get anywhere. That was thirteen billion dollars ago. Is there a woman that you haven't talked to you that you would like to talk to? Well,

Queen Elizabeth doesn't do interviews. UM, so I think that's probably not gonna happen. But I would say I have not interviewed Mrs Obama. I've met her many times, I haven't interviewed her. You should be very good as an interviewee. I have interviewed Melinda Gates. Uh. I've interviewed many business leaders who are prominent women. Uh. And in scott have you thought about I have met her, but I don't haven't interviewed I. I haven't actually asked her yet. I don't.

I think she's relatively shy and doesn't seek publicity as the way she's doing it. But if she's watching or listen thing right now, I'm ready to come out Seattle tomorrow and do that interview because she's doing some really good things in philanthropy and really turned the world upside down by doing it fast, doing it very differently than how a lot of other people have done it for

a long time. Yes, and uh, I mean she's got I think she was given thirty four billion dollars and now it's probably worth seventy five billions, So she's got a lot of money. Your three minutes left, Please don't go anywhere. No, just stay forever. Um the investment environment, I don't know whether it's back, whether it's crypto. What's interesting to you right now? Well, clearly crypto is something that gets a lot of attention. It's amazing how many

people are interested in crypto. Are you invested in crypto in any way? I have not invested in crypto currencies myself. I have invested in some companies that kind of service the industry. And my standard view on crypto is when you go to Las Vegas, most people are smart to know you're not gonna win there, maybe spend more time than you're certainly not gonna win, but you enjoy it. You have the pleasure of gambling. So you picked one or two percent of your net worth and do that. Well,

the same as true in crypto. Crypto you want to speculate, you don't really know that much about it. Try it one or two or three percent. It's not harmful and you'll probably have enjoyable time. Perhaps. I interviewed for my my show on Bloomberg John Paulson recently, and he is dead set against it. He just said, this is terrible and it's going to zero. And but on the other hand, I've interviewed some other people that will come out soon who are gonna be saying, hey, I think it's a

way to make a lot of money. There's one person I be interviewing soon who's who's made billions of dollars in crypto. What about when it comes to SPACs and where we are in this cycle with SPACs? Are they here to stay? And look, spacts aren't anything new, They're just having a moment right now. SPACs are not going away. Um. But you have to be wary of what you're doing.

You have to know what you're really doing. So spacts are a way to accelerate an I p O process, And right now it's harder to raise money for SPACs and not just the spack money. There are two types of money yet you have to really raise You raise the riditional money for the spact, but then you raise money that's called a pre I p O pipe money, which is the money to help you get public um or help the public evaluation uh state at what you think it should be. And it's harder to raise that

money right now. A lot of somebody is raising I think it's Apollo is raising a fund to invest in the SPACs that aren't doing so well and to buy them on the cheap, which is an idea that I think is probably has some merit. We've already gone to distress SPACs. UM. Thirty seconds left here? What do you think will be the next Grand American Experiment? Just quickly? Well,

the next experiment that I think we'll see UM. I think probably we're going to see UM at some point, I hope UM greater cooperation between the Republicans and Democratic parties when we have some crisis that really unites them in ways that we haven't really truly been united since nine eleven. Now we're getting ready to celebrate or mark I shouldn't I celebrate than the aversary nine eleven. UM, we're gonna do at the Kenny Center on the chairman

of the Kenny Center. We're gonna have an event doing that and thanking our military people, but also thanking the healthcare workers we've got us through this most recent period of time. We thank you, thank you very much for having so much. David Rubinstein, of course, co founder coach share of the Carlisle Group. His latest book, The American Experiment, Dialogues on a Dream Do check it out it's a great still summer. It is still summer. Everyone still summer. Read This is Bloomberg Radio.